When is the best time to buy New Zealand Dollars in 2016?

GBP EUR Exchange Rate: Weekly Review July 16  
  • GBPNZD heading back to post-Brexit lows
  • Commodity currencies likely to steal the show ahead of the US elections
  • Are further losses likely?

Pound loses post-Brexit gains against the New Zealand Dollar

Sterling has recouped some its losses since the vote to leave the EU, GBPNZD exchange rates peaked at 1.84 on the exchange last week, and has since slid below 1.80 following poor manufacturing output data from the UK. With Brexit still the number one concern for investors, any negative data from the UK is exasperating Sterling movements. Whilst many now see the UK avoiding a recession in 2017, investors will continue to scrutinise economic data for extra reassurance.

US elections could boost the New Zealand Dollar

During times of global uncertainty commodity currencies can often find themselves at the center of investment. Commodity economies typically offer higher interest rates whilst being particularly risky to trade. With events happening in the UK, Europe and the US over the coming months, the risk for such currencies like the NZD can outweigh the potential losses within a volatile market elsewhere. And with higher interest rates comes higher rates of return.

We could therefore see the likes of the Australian Dollar and New Zealand Dollar strengthen as we approach November. And given that economic data out of the UK continues to provide a mixed outlook I would consider buying the New Zealand Dollar sooner rather than later. Whilst positive data from the UK provides some movements for Sterling, a negative trend has a much more impactful response on the Pound.

You can email me at [email protected] if you would like to discuss a currency transfer, I would be happy to assist you with a quote.